Costain Group Regulatory News (COST)

Costain Group PLC

("Costain" or "the Group")

Appointment to Transmission Frameworks with National Grid

Costain, one of the UK's leading engineering solutions providers, is pleased to announce that it has been appointed to three transmission frameworks with National Grid to provide a broad range of services, including front end engineering design, programme management, construction and asset optimisation.

The three frameworks are as follows:

· Civil Works For Underground Cables: Costain has secured one of six places on this framework for design, programme management and construction services. The framework contractors have the potential to share in a maximum of £500m of work planned over the next four years.

· New Overhead Lines: Costain has, in joint venture, secured one of seven places for an initial four years with the potential to extend for a further four year period.

· Upgrade of UK's Gas Transmission System: Costain has secured one of four places on the framework to provide front end engineering and design and an initial contract to upgrade compressor stations at Huntingdon and Peterborough.

National Grid plans to invest up to £26bn between now and 2021 (RIIO1 period) upgrading and developing their gas and electricity networks to connect people to the energy they need. By securing a place on both electricity frameworks, Costain can deliver end-to-end network solutions which will form an important part of upgrading the national infrastructure to support connection of low carbon generation and the UK's future energy needs.

The frameworks commence immediately.

Andrew Wyllie, Chief Executive of Costain, commented:

"We are delighted to have been appointed to these frameworks by National Grid, for whom we are currently delivering the London Power Tunnels.

"These awards are at the very heart of our 'Engineering Tomorrow' strategy of focusing on blue chip customers whose major spending plans are underpinned by strategic national needs. The awards also reflect the ongoing broadening of our service offering, in which we form long-term, strategic partnerships with our customers to deliver an increasingly multidisciplinary range of services across the full life cycle of their assets."

25 March 2014

(1) The RIIO ('Revenue= Incentives + Innovation + Outputs') period refers to the current eight year regulatory framework period which runs from 2013 to 2021.

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